The Internet of Things: a Stealthy Revolution That’s Already Been Won

It will probably surprise no one that this year’s C3 conference will feature a lot of discussion of the Internet of Things. CallidusCloud telegraphed its move toward IoT last summer at Dreamforce and again this winter at C3 EMEA, so it’s no secret how seriously the company – and many others – take IoT and its ramifications.

Some might see this as futuristic – namely, those who view the IoT through the lens of a B2C buyer. The IoT in the home sounds like something out of the Jetsons, with your refrigerator capable of ordering groceries, your washing machine scheduling its own service before it breaks down, and your cat’s litter box transmitting feline health data to your veterinarian. (OK, I haven’t heard anyone propose an IoT litter box yet – if you see it, tell ‘em to include my name on the patent, please!)

These IoT applications seem futuristic because they affect daily home life, the mundane things we do and the way we live. But the business world is a lot different. According to Forrester, one in four companies is already incorporating the IoT into its business. That number is going to increase precipitously over the next few years, and once IoT comes to dominate the B2B space it should already be making significant inroads to B2C markets.

And we’ll all sit around marveling at how fast it happened. But we’ll be wrong.

The idea of the IoT – that devices can send data about their usage and wear to vendors, enabling vendors to provide better service, just-in-time sales of supplies and to make product recommendations that help the customers – has been around for a while. It’s already all around us, and it’s quietly had an impact on our lives.

For example, if you’ve ever flown commercially, you’ve been affected by IoT concepts. More than 50 years ago, Bristol Siddeley came up with the idea of “power by the hour” – instead of the aircraft owner also owning the engines, the engine manufacturer owned them, and the operator paid a flat fee for their operation. When it was time for an overhaul or a field repair, the engine company took care of it – all for that flat fee. This took unexpected costs off the aircraft owner’s list of concerns, and it allowed the engine companies to increase revenues – and it also provided an incentive to the engine manufacturers to make better, more reliable engines. It also allowed airlines to eliminate service facilities all over the world because engine service was now handled by the engine manufacturer’s facilities, which could operate more efficiently because they worked on engines from multiple airlines.

Around 2010, the major engine manufacturers (General Electric, Pratt & Whitney and Rolls Royce) began to use sensors in the engines to monitor wear. These sensors transmitted data to a system in the aircraft that would send the engine data when the aircraft was in range of a ground station. This allowed the engine manufacturers (as well as the airframe manufacturers, who adopted these concepts as well) to have equipment and personnel in place to repair or replace engines and other components – not just when they broke but ideally before they broke. This maximized flight time – which made the engine companies more money and also ensure that the airlines made more money, too.

If you haven’t flown lately, you undoubtedly bought something. If you’re a consumer in any way, IoT ideas have already affected you. The logistics industry was one of the earliest users of telemetry, sensors and the Internet to track every part of the journey of products from their manufacture to their delivery to customers. Bar coding – a manually-executed form of “sensor” – has long been used to track shipments, pallets and even individual products. The next step was to turn shipping containers into devices that could transmit data about their disposition (and helpful data like how often their doors were opened and closed) to satellites, allowing companies to track their progress across the ocean and to spot incidents of theft (or even to recover wayward containers that have fallen off ships). Once the containers are unloaded from the ships, they’re transported by a network of trucks – most of which now are equipped with sensors and telemetry that reports their position. This not only has benefits for manufacturers and sellers; if you’ve ever tracked a package, you’re tapping into this IoT-like network of sensors.

Then there’s the classic example of the IoT copy machine (which has now morphed into an IoT printer). Despite all the good they do, these office staples have long been a source of frustration, with consumables like paper and toner that can run out and seemingly inexplicable breakdowns that require service calls. It wasn’t a difficult scenario for the companies that offered service contracts for these devices to realize that IoT thinking could change the equation: with the right data from the device and the right contact in place from the customer, consumables could be delivered before they ran out and service appointments could be scheduled before components broke down. This data could also be used to drive sales – if a printer was in constant use all day, perhaps it might be a good idea to suggest a second printer to alleviate bottlenecks and ensure greater productivity?

All these examples are at work in our world today, creating better customer experiences for buyers while enhancing revenues for sellers. The question your business needs to ask is not whether you will use the IoT, but how will you use it best and how quickly you can put it in place to gain a competitive advantage.

Need more inspiration – and perhaps a guide to quickly including IoT data into your sales and marketing systems? You need to check out C3 2016, May 9-11 in Las Vegas. If you can’t be there, be sure to sign up to see the keynote in which CEO Leslie Stretch and some CallidusCloud customers discuss the IoT – not the IoT of the future but the IoT of the present.

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Chris Bucholtz is the content marketing director at CallidusCloud and writes on a host of topics, including sales, marketing and customer experience. The former editor of InsideCRM, his weekly column has run in CRM Buyer since 2009. When he's not pondering ways to acquire and keep customers, Chris is also an avid builder of scale model airplanes.